RBI net seller of dollars by $644 million in November
THE Reserve Bank remained a net seller of dollars in November 2018, as it sold $644 million of the greenback on a net basis in the spot market, according to the latest data from the Central bank.
As against this, in November 2017, the Central bank had purchased $2.570 billion from the spot market and sold $1.706 billion, while in the reporting month, the monetary authority bought $3.127 billion from the spot market, and sold $3.771 billion, show the data. The rupee had a better run in the past fiscal, while it was one of the worst among its emerging market peers this fiscal year, which explains the reasons for the RBI intervention in the forex market.
In October 2018 also, the RBI was a net seller of dollars, after it purchased $945 million and sold $8.149 billion of the US currency in the spot market. Normally, the central bank sells dollars to contain rupee volatility as it does not officially set a price level for the rupee, which is only partly fully floating as the country does not allow full capital account convertibility. In first five months of this fiscal year, the central bank has sold a whopping $34 billion as the rupee was on a rollercoaster, plumbing a low of 74 to the American unit. Between April and November 2108, the central bank has net sold $ 26.51 billion of dollars in the spot market. This compares with a net purchase of $ 18.017 billion made in the same period in 2017.
The RBI has, so far, remained a net-seller of the US currency in the current fiscal. In FY18, the apex bank had net purchased $ 33.689 billion from the spot market, taking its total dollar purchase to $52.068 billion, while selling $18.379 billion, this helped the country for the first time scale a life-time peak of $426.028 billion for the week to April 13, 2018 in forex reserves.